Author Question: If your income increases from 30,000 to 35,000 and your consumption increases from 11,000 to 12,000 ... (Read 67 times)

kellyjaisingh · **on:** Jun 30, 2018

If your income increases from 30,000 to 35,000 and your consumption increases from 11,000 to 12,000 . your marginal propensity to consume (MPC) is:
a. 0.2.
b. 0.4.
c. 0.5.
d. 0.8.
e. 1.0.

Question 2

Causality is clear and mechanical with the quantity theory of money. If M increases because:
a. V and Q are variable, the price level, P, increases.
b. V and Q are variable, the price level, P, decreases.
c. V and Q are constant, the price level, P, increases.
d. V and Q are constant, the price level, P, decreases.
e. P and Q are constant, velocity, V, increases.